NASCAR offers big economic boom for Virginia

WASHINGTON — Virginia Gov. Terry McAuliffe has been trying to woo the Washington Redskins to Northern Virginia, touting the economic benefits a new football stadium and the team would bring to the state.

But a recent report from Old Dominion University said the state should consider the benefits NASCAR events have in Virginia.

NASCAR has seen attendance decline at its events in recent years, from 7.66 million in 2008 to under 6 million in 2015, and tracks are removing seating. Its teams struggled to get by as the Great Recession left sponsors less able to put money into their brand and into the sport.

But despite these setbacks, the sport continues to be profitable and popular. Not only that, but it has proved to be a major draw and huge economic driver in the state.

The Old Dominion University report said that while many studies and surveys talk about economic impact of sporting events and activities, such as college football games, it often excludes what it called “displaced expenditures.”

“For example, when a resident of Fairfax County spends $250 at Fair Oaks Mall in Fairfax, if this reduces expenditures elsewhere in Fairfax County by $250, then the net economic impact of this expenditure is zero insofar as the county and the Commonwealth of Virginia are concerned,” the report explained. It does not add new money into a local economy, it recycles the money that already exists within it.

“However, stock racing is a bird of a different color,” the report continued, “because it typically attracts people from other regions and other states who spend money that does not represent expenditures displaced from other jurisdictions immediately around the track.”

NASCAR fans from across the country come to where a race is being held and spend days in the area. They spend money lodging at local hotels, fueling up at area gas stations, eating at local restaurants and shopping at local stores.

The report highlights two economic studies from 2009 on tracks in Virginia.

One showed that Richmond International Raceway, which hosts two NASCAR premier series events every year, generates $557 million for the state, including $36 million in local and state tax revenues.

The other showed that Martinsville Speedway generates $170 million a year statewide. That track also hosts two events a year.

Just beyond the Tennessee border is Bristol Motor Speedway, which also hosts two premier series events a year and benefits Virginia tourism in Bristol, Virginia.

To battle declining race attendance, tracks have been diversifying their offerings. Bristol Motor Speedway hosted what was dubbed “the biggest football game ever” this past September between Virginia Tech and Tennessee.

Other tracks outside of the state, such as Dover Motor Speedway, have taken on the music festival scene. That track hosts the Firefly music festival on its campgrounds.

The report said stock car racing plays a major role in many parts of the state, both economically and socially.

“Despite the considerable economic impact of large NASCAR races that easily attract more than 100,000 fans, there has been a tendency among some to pooh-pooh the sport as somehow not being in the same category as sports staples, such as football and basketball,” the report stated.

“In fact, the economic impact of NASCAR races in Virginia (counting Bristol) appears to be larger than the economic impact of all intercollegiate athletic contests in the state combined. This is because the college contests typically involve significant displacement of expenditures that would have occurred in any case somewhere in Virginia.”

However, its concern is that if the trend of weakening attendance continues, it not only affects the sport, but also hurts the economies of these smaller communities in southern Virginia that in many cases are already struggling.

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